Posted on Fri, Jan. 16, 2009

Preschool plan in peril, Corzine saysAn effort to aid low-income children may be delayed because of a looming state budget shortfall, he said.

By Jonathan Tamari

Inquirer Trenton Bureau

A looming state budget shortfall could delay New Jersey's plans to expand preschool for low-income children unless the Obama administration provides financial aid, Gov. Corzine said yesterday.

> In a meeting with The Inquirer's editorial board, Corzine also said that he expected to see "real action" soon among schools to share services, and that he hoped to avoid tax increases to make up the latest budget gap. But he left the door open for a future gas-tax increase to pay for transportation needs.

> While Corzine cautioned that he was still working on his budget plans, the interview provided a glimpse into the governor's thinking as he prepares to introduce a budget that he expects will be roughly $3 billion, or 9 percent, smaller than the one he signed last year. He faces plummeting revenues because of the national financial crisis.

> "We have to do something to demonstrate clearly to the public that we are serious about resizing, reshaping, re-forming government," Corzine said. "We're going to have to pick some things that we can't do."

> The preschool plan, which would have required preschool for all low-income New Jersey children within five years, was part of the education proposal Corzine signed in early 2008.

> Corzine said he might have to "step back" from the plan, unless preschool funding is part of an Obama financial package.

> "Otherwise, I think we'll have to defer," he said.

> Districts this year are scheduled to begin the first step in a five-year process of providing preschool to an additional 30,000 low-income children.

> Corzine, who is scheduled to introduce a new budget in March, also hinted that he would look to shrink government. Last year he axed two departments, although a third proposed cut, the Department of Agriculture, elicited fierce protests.

> "Some of the consolidations of departments might look more reasonable today in a budget speech than they did a year ago when people didn't feel quite so under the gun," Corzine said.

> He said that the financial crisis also was pushing local governments to consider service-sharing or consolidation, and that he expected action in this area within the next three months, particularly when it came to schools. School costs make up the largest portion of property-tax bills.

> One likely target could be districts that do not operate any schools and send their students to other towns. When Corzine signed a series of 2007 property-tax changes, new county school officials were charged with eyeing these districts for savings.

> "That will be the first area of focus for sure," said Assembly Speaker Joseph J. Roberts (D., Camden), an advocate for the county controls on school spending. "They'll be front and center for consolidation."

> Corzine said he was trying "very hard" to avoid tax increases this year. He has not raised taxes since 2006.

> "We've got a really heavy burden on our people, and putting on additional burdens is not a good idea," he said.

> Asked specifically about a gas-tax hike, Corzine said it would be "very damaging" to drivers' psyches.

> "I'm going to try to avoid it," Corzine said. "But it doesn't mean in the long run that we're not going to have to have a gas tax to fix our infrastructure."

> Corzine reiterated that he wanted to freeze or reduce wages for state employees, who are due a 3.5 percent raise this year under their contract. Corzine said that without a concession, there would have to be layoffs or furloughs.

> Hetty Rosenstein, New Jersey area director for the Communications Workers of America, said Corzine should target the wealthy - people earning more than $250,000 a year - before middle-class workers.

> State workers' raises, she said, would go directly back into spending on essentials and help stimulate the economy.

> "If they get a small raise, that raise is going directly to the grocery store with them," she said.

>Contact staff writer Jonathan Tamari at 609-989-9016 or jtamari@phillynews.com.

> 

N.J. to wait for fed report before budget is presented

Friday, January 16, 2009

BY JOHN REITMEYER

NorthJersey.com

TRENTON BUREAU

Governor Corzine's plan to delay introduction of the next state budget is moving forward, but one part of his strategy to handle this year's $2.1 billion budget hole stalled on Thursday.

The state Assembly Budget Committee voted to allow Corzine to introduce the fiscal 2010 spending plan in March this year even though state law requires the budget to be presented by the end of February.

Democrats on the committee — who hold the majority — voted in favor of the delay, while Republicans opposed it.

"I just think it's worth it," said committee Chairman Lou Greenwald, D-Camden. "This is one of those areas where people make partisan points and we just need to get beyond that."

Corzine is seeking the delay to find out how much federal money could be allocated for New Jersey's budget woes when Congress assembles another federal stimulus package in a process scheduled for next month.

Earlier this month, the governor said New Jersey is facing a $2.1 billion budget hole in the current fiscal year, which runs through June, and an up to $5 billion deficit by the time the next fiscal year begins in July.

Part of Corzine's plan to deal with the immediate deficit includes receiving about $300 million in federal money. He is also hoping to get funds from Congress for the fiscal 2010 spending plan and wants to hold off on presenting a budget — and some expected new cuts — until after the state learns just how much federal money is coming.

"This is about research," said Assemblyman Joe Cryan, D-Union. "This is about priorities."

But Assemblyman Joe Malone, R-Burlington, said the delay sends a message to the public that the state is unprepared.

"I think holding this off isn't going to serve any purpose," said Malone, the top Republican on the panel.

The committee, meanwhile, shelved a vote on another measure Corzine is seeking as part of his plan to close that $2.1 billion deficit.

Legislators said they had technical questions about the bill, which would enact the legislative component of a round of $812 million in midyear spending cuts the governor is seeking. Greenwald said it would be posted at a future meeting once their questions are answered.

"Budget cuts are necessary for the state right now because we're taking in less money than we had thought we would take in," said committee Vice Chairman Gary Schaer, D-Passaic.

"What many people don't understand with budgets — budgets from governments certainly — is that they're based upon projections."

E-mail: reitmeyer@northjersey.com